Real Estate Round-Up: N is for negotiating part 2
Last updated 6/9/2021 at 10:30am
Last week I focused on how important negotiating is when a Realtor represents a buyer. The key to success always starts with trust and confidence, that the Realtor can help the buyer achieve their goal of purchasing a property. In a fast paced, challenging market, like we are currently operating in, that trust and confidence is the centerpiece to writing the best offer possible, that both protects the buyer’s interest, yet is appealing enough to the seller. A skilled, experienced, Realtor, will write an offer that achieves both objectives and secures the property for the buyer they are representing.
Last week, I am happy to say that I wrote two offers for the same buyer, using my experience and knowledge, and they received acceptance on both. That’s the kind of result any buyer wants.
Let’s talk about Realtors who represent sellers. Realtors who represent sellers negotiate not only with the seller but with the cooperating Realtor who represents the buyer. The minute we sit down with a seller, the negotiating begins.
We are negotiating our value with every word we speak. We negotiate trust and confidence through the words we speak and the actions we perform. Knowing your Realtor understands your goals and has the tools to achieve or exceed those goals, is a negotiation that starts and continues throughout the relationship and beyond.
This negotiation with a seller is the key tool that allows the seller to trust the Realtor as they review multiple offers and provide informed responses to best benefit the seller.
I am always astonished when a seller makes it all about the commission they will pay to a Realtor for selling their home. When it should be about how much more money they will make if they choose a Realtor with the experience, knowledge and negotiating skills to achieve that. Yes, it’s a hot market. Yes, most homes sell quickly. Yes, most homes sell for the list price or slightly above the list price. But let’s stop right there.
If these indicators were all that mattered, every home with the same characteristics, on similar parcels would all sell for approximately the same price. But they don’t. Some sell for much, much more. Why is that? The sellers who achieve a premium price for their home are working with a Realtor who has the negotiating skills to accomplish that. And they’re not the cheapest Realtor.
Just like the best surgeons or best attorneys, the best are not the cheapest. People pay for the best outcome, it’s no different in real estate. The most skilled negotiator will achieve not only the highest sale price for the seller, but they will get paid for their skill to accomplish that.
In this hot market, suppose the Realtor doesn’t list the property for the maximum value? There might be a bidding war, but does anyone know how high up is, or how high up should be? In an accelerating market, each next sale is higher, but
a skilled negotiator knows how high to price a property, so the final sale price far exceeds the accelerated price. We do it every single time.
I’ve previously written about other terms that benefit the seller and have added value to the purchase price. Helping the seller understand the value of these secondary terms is a negotiation. Since it’s common for a seller to focus on the
purchase price, discussing the other terms, or negotiating with the seller on the value of those other terms requires knowledge and experience that is invaluable.
We discuss all the possibilities at the time we list the property with the seller. We want them to go into the process fully aware of the amazing opportunities that exist to help them open escrow with the best offer.
Once the seller understands all their options, it makes it possible for us to negotiate with the buyers and buyers’ Realtors when they are viewing the property.
Remember, negotiating is an on-going process. It doesn’t only start once offers are received. It is established with the seller, continued during the showing process, highlighted during the review of offers, and utilized throughout the escrow. Until a property closes escrow, the opportunity for negotiating exists and is utilized by experienced Realtors.
Negotiation is the key to success in real estate, as it is in life. The ability to be provided the freedom to negotiate with either a seller or a buyer, is based on trust and confidence in their Realtor.
Buying or selling a property is a very important life experience. Don’t commit yourself to a Realtor based on how much it will cost you. Commit to a Realtor based on how much you trust that Realtor to focus on achieving your goals, and the equity will follow.
Kim Murphy can be reached at [email protected] or 760-415-9292 or at 130 N Main Avenue, in Fallbrook. Her broker license is #01229921, and she is on the board of directors for the California Association of Realtors.